Food giant Kraft Foods Inc. has put its Altoids breath mints and Life Savers brands on the block in a sale that could generate well over $1 billion, people familiar with the situation said Friday.
Northfield, Illinois-based Kraft, the maker of Oreo cookies and Jell-O, has given investment bank UBS AG a mandate to sell the brands, the sources said.
A sale could bring between $1.2 billion to $1.4 billion, according to Lehman Brothers. If completed, a sale would be part of Kraft's move to weed out brands that do not fit its global strategy.
"It's a good business. They're not selling distressed merchandise there," said Ken Harris, partner at brand consultancy Cannondale Associates.
Combined, the two brands generate more than $300 million in annual sales, sources said.
Both Kraft and UBS declined to comment.
Kraft Chief Executive Roger Deromedi said in recent months that the company is looking to build brands that have global appeal and said regional brands may be divested.
Kraft transformed Altoids from a languishing brand it acquired in the 1990s into a popular mint known for its strong flavor and edgy advertising.
"They really created something out of nothing, into sort of a cultural icon," Harris said.
Life Savers was part of the Nabisco portfolio Kraft acquired in 2001. Since the purchase, Kraft expanded the business with new products, including CremeSavers, candies with fruit and cream flavors.
Kraft is No. 1 in the U.S. non-chocolate candy market, with a 17 percent share of the $2.64 billion market, Lehman Brothers said in a recent report, citing ACNielsen data. Kraft is 51.6 percent owned by Altria Group Inc.
The Daily Deal, a mergers and acquisitions publication, reported the Kraft move on its Web site on Friday.
